SALOMON BROTHERS MORTGAGE SECURITIES VII INC
8-K, 1999-05-13
ASSET-BACKED SECURITIES
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                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                    FORM 8-K

                                 CURRENT REPORT

                     Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934


Date of Report (Date of earliest event reported) May 13, 1999


                 SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.
- --------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

           Delaware                     333-72647            13-3439681
- ----------------------------          -----------       ----------------------
(State or Other Jurisdiction          (Commission          (I.R.S. Employer
of Incorporation)                     File Number)      Identification Number)

390 Greenwich Street, 4th Floor
New York, New York                                               10013
- ------------------                                               -----
(Address of Principal                                         (Zip Code)
Executive Offices)

Registrant's telephone number, including area code:  (212) 723-8604



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<PAGE>







Item 7.  Financial Statements, Pro Forma Financial Information And Exhibits.

                  (a)      Not applicable

                  (b)      Not applicable

                  (c)      Exhibits:

                              Item 601(a) of
                              Regulation S-K
Exhibit No.                   Exhibit No.           Description
- -----------                   -----------           -----------
    1                             5.1          Opinion and Consent of Thacher
                                                   Proffitt & Wood.





<PAGE>





                                   SIGNATURES

                  Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.

                                      SALOMON BROTHERS MORTGAGE
                                      SECURITIES VII, INC.


                                      By:      /s/ Matthew R. Bollo
                                         ---------------------------------
                                      Name:    Matthew R. Bollo
                                      Title:   Assistant Vice President


Dated:  May 13, 1999




<PAGE>



                                  EXHIBIT INDEX


                  Item 601(a) of
Exhibit           Regulation S-K
Number            Exhibit No.            Description
- ------            ---------------        -----------

  1                 5.1              Opinion and Consent of Counsel



                                                                    EXHIBIT 5. 1
                     [Letterhead of Thacher Proffitt & Wood]




                                        May 13, 1999



Salomon Smith Barney Inc.
390 Greenwich Street, 4th Floor
New York, New York  10013

                  Opinion:  Underwriting Agreement
                  Salomon Brothers Mortgage Securities VII, Inc.,
                  Floating Rate Mortgage Pass-Through Certificates,
                  Series 1999-3
                  -------------------------------------------------

Ladies and Gentlemen:

         We have acted as counsel to Salomon Brothers Mortgage Securities VII,
Inc. (the "Depositor") in connection with (i) the sale of certain mortgage loans
(the "Mortgage Loans") by Salomon Brothers Realty Corp. (the "Seller") to the
Depositor pursuant to (a) the Mortgage Loan Purchase Agreement, dated May 11,
1999 (the "Ameriquest Purchase Agreement"), among the Seller, Ameriquest
Mortgage Company ("Ameriquest") and the Depositor, (b) the Mortgage Loan
Purchase Agreement, dated May 11, 1999 (the "New Century Purchase Agreement"),
among the Seller, New Century Mortgage Corporation ("New Century") and the
Depositor and (c) the Mortgage Loan Purchase Agreement, dated May 11, 1999 (the
"SBRC Purchase Agreement"; collectively with the Ameriquest Purchase Agreement
and the New Century Purchase Agreement, the "Purchase Agreements"), between the
Seller and the Depositor, and (ii) the issuance of Floating Rate Mortgage
Pass-Through Certificates, Series 1999-3, Class A, Class M-1, Class M-2 and
Class M-3 (the "Underwritten Certificates"), Class CE, Class P, Class R-I, Class
R-II and Class R-III (the "Residual Certificates"; together with the
Underwritten Certificates, the "Certificates"), pursuant to the Pooling and
Servicing Agreement, dated as of April 1, 1999 (the "Pooling and Servicing
Agreement") among the Depositor as depositor, Ameriquest, Long Beach Mortgage
Company, New Century and Ocwen Federal Bank FSB as master servicers (the "Master
Servicers") and Norwest Bank Minnesota, National Association as trustee (the
"Trustee"). In consideration for its purchase of the Mortgage Loans, the
Depositor will deliver to the Seller immediately available funds. The Depositor
will sell the Underwritten Certificates to Salomon Smith Barney Inc. (the
"Underwriter") for offer and sale pursuant to the terms of an Underwriting
Agreement, dated May 11, 1999 (the "Underwriting Agreement"), between the
Depositor and the Underwriter and will transfer the Residual Certificates to the
Underwriter. The Purchase Agreements, the Pooling and Servicing Agreement and
the 

<PAGE>

Underwriting Agreement together, are hereinafter collectively referred to as
the "Agreements". Capitalized terms not otherwise defined herein shall have the
meanings set forth in the Agreements.

         In rendering this opinion letter, we have examined the documents
described above and such other documents as we have deemed necessary including,
where we have deemed appropriate, representations or certifications of officers
of parties thereto or public officials. In rendering this opinion letter, except
for the matters that are specifically addressed in the opinions expressed below,
we have assumed (i) the authenticity of all documents submitted to us as
originals and the conformity to the originals of all documents submitted to us
as copies, (ii) the necessary entity formation and continuing existence in the
jurisdiction of formation, and the necessary licensing and qualification in all
jurisdictions, of all parties to all documents, (iii) the necessary
authorization, execution, delivery and enforceability of all documents, and the
necessary entity power with respect thereto and (iv) that there is not any other
agreement that modifies or supplements the agreements expressed in the documents
to which this opinion letter relates and that renders any of the opinions
expressed below inconsistent with such documents as so modified or supplemented.
In rendering this opinion letter, we have made no inquiry, have conducted no
investigation and assume no responsibility with respect to (a) the accuracy of
and compliance by the parties thereto with the representations, warranties and
covenants contained in any document or (b) the conformity of the underlying
assets and related documents to the requirements of the agreements to which this
opinion letter relates.

         Our opinions set forth below with respect to the enforceability of any
right or obligation under any agreement are subject to (i) general principles of
equity, including concepts of materiality, reasonableness, good faith and fair
dealings and the possible unavailability of specific performance and injunctive
relief, regardless of whether considered in a proceeding in equity or at law,
(ii) the effect of certain laws, regulations and judicial and other decisions
upon the availability and enforceability of certain covenants, remedies and
other provisions, including the remedies of specific performance and self-help
and provisions imposing penalties and forfeitures and waiving objections to
venue and forum, (iii) bankruptcy, insolvency, receivership, reorganization,
liquidation, fraudulent conveyance and transfer, moratorium and other similar
laws affecting the rights of creditors or secured parties and (iv) public policy
considerations underlying the securities laws, to the extent that such public
policy considerations limit the enforceability of the provisions of any
agreement which purport or are construed to provide indemnification with respect
to securities law violations. However, the non-enforceability of any such
provisions will not, taken as a whole, materially interfere with the practical
realization of the benefits of the rights and remedies included in any such
agreement which is the subject of any opinion expressed below, except for the
considerations referred to in foregoing clause (iv) and the consequences of any
judicial, administrative, procedural or other delay which may be imposed by,
relate to or arise from applicable laws, equitable principles and
interpretations thereof.

         In rendering this opinion letter, we do not express any opinion
concerning any law other than the federal laws of the United States, including
the Securities Act of 1933, as amended (the "1933 Act"), the laws of the State
of New York and the General Corporation Law of the State of Delaware. We do not
express any opinion with respect to the securities laws of any jurisdiction or
any other matter not specifically addressed in the opinions expressed below.


<PAGE>

         Based upon and subject to the foregoing, it is our opinion that:

         1.       The Pooling and Servicing Agreement, assuming the
                  authorization, execution and delivery thereof by the parties
                  thereto, constitutes a valid and legally binding agreement
                  under the laws of the State of New York, enforceable
                  thereunder against the Depositor in accordance with its terms.

         2.       The Class A Certificates, the Class M-1 Certificates, the
                  Class M-2 Certificates and the Class M-3 Certificates,
                  assuming the execution, authentication and delivery in
                  accordance with the Pooling and Servicing Agreement and the
                  delivery thereof and payment therefor in accordance with the
                  Underwriting Agreement, are validly issued and outstanding and
                  are entitled to the benefits of the Pooling and Servicing
                  Agreement.

         3.       Assuming compliance with the provisions of the Pooling and
                  Servicing Agreement, for federal income tax purposes, REMIC
                  I, REMIC II and REMIC III will each qualify as a real estate
                  mortgage investment conduit ("REMIC") within the meaning of
                  Sections 860A through 860G (the "REMIC Provisions") of the
                  Internal Revenue Code of 1986, the Class R-I Certificates
                  will constitute the sole class of "residual interests" in
                  REMIC I, the Class R-II Certificates will constitute the
                  sole class of "residual interests" in REMIC II, the Class A
                  Certificates, the Class M-1 Certificates, the Class M-2
                  Certificates, the Class M-3 Certificates, the Class CE
                  Certificates the Class P Certificates will represent
                  ownership of "regular interests" in REMIC III and will
                  generally be treated as debt instruments of REMIC III and
                  the Class R-III Certificates will constitute the sole class
                  of "residual certificates" in REMIC III, within the meaning
                  of the REMIC Provisions in effect on the date hereof. This
                  opinion confirms and adopts the opinion set forth in the
                  Registration Statement.

         We hereby consent to the filing of this opinion letter as an Exhibit to
the Registration Statement, and to the use of our name in the prospectus and
prospectus supplement included in the Registration Statement under the headings
"Certain Federal Income Tax Consequences" and "Legal Matters", without admitting
that we are "persons" within the meaning of Section 7(a) or 11(a)(4) of the 1933
Act, or "experts" within the meaning of Section 11 thereof, with respect to any
portion of the Registration Statement.

                                        Very truly yours,

                                        THACHER PROFFITT & WOOD

                                        By: /s/ Thacher Proffitt & Wood
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